Obama Visits Detroit Truck Maker as ‘Fiscal Cliff’ Looms

Chip Somodevilla/Getty Images(DETROIT) — With the “fiscal cliff” 21 days away, President Obama on Monday takes his second-term economic agenda on the road to the Motor City, pitching higher taxes on the wealthy and greater investment in U.S. manufacturing.

Obama will tour a Detroit Diesel Corp. engine facility, owned by Germany-based Daimler, and deliver a speech on “the economy and middle class families,” the White House said. In conjunction with the visit, the company planned to announce a $100 million investment in expanded U.S. production and new jobs.

Obama is using the trip to highlight the jobs news as a bright spot in uncertain economic times, while trying to bolster his image as a “warrior for the middle class.” Before a backdrop of auto workers, Obama will renew his push to extend for 98 percent of Americans the current tax rates that are set to expire at the end of the year.

Republican and Democratic lawmakers agree on the extension, but its passage has become entangled in the broader “cliff” debate. Unless Obama and Republicans reach a deficit-reduction deal by Dec. 31 to avert a looming package of automatic tax hikes and deep spending cuts, the average American middle-income family could see taxes rise by more than $2,000 next year.

The top negotiators in search of a deal — Obama and House Speaker John Boehner — met face-to-face on Sunday at the White House for the first time in more than three weeks. Neither side would offer details of the session, however, with aides saying only that “the lines of communication remain open.”

Some Republicans have begun showing flexibility about approving higher tax rates for upper-income earners — a key demand of Obama and Democrats — but only in exchange for more significant cuts to entitlement program spending than those proposed by the White House.

“We don’t have a lot of cards as it relates to the tax issue before year’s end,” said Republican Sen. Bob Corker of Tennessee on Fox News Sunday. “So a lot of people are putting forth a theory, and I think it has merit, where you go ahead and give the president… the rate increase on the top 2 percent, and all of the sudden the shift goes back to entitlements.”

Officials in Detroit said Daimler’s announcement would make Daimler Trucks North America the first heavy-duty truck company in the U.S. to produce the engine, axles and transmission all in one place. It is expected to lower manufacturing costs and consumer prices as well as improve fuel efficiency.